Corn Falls from Record Despite USDA Report
Corn fell even though the US Department of Agriculture predicted smaller output from the United States due to hot dry weather. The USDA predicted that production will fall to 10.779 billion bushels (273.8 million metric tons) this year down from 12.358 billion in 2011.
Drought in other parts of the world, including Russian and India, will affect global supply, driving food costs higher. The US said that global output of corn will total 849.01 million tons in the year beginning October 1, compared to 876.84 million last year. The previous estimate was 905.23 million.
Earlier, the crop rallied to the record high. Interestingly enough, the reason for the rally was expectations for the USDA to cut it forecast for corn production. Yet prices slipped after the Department had actually done as expected.
Corn slid by $0.1450 (1.76 percent) to close at $8.0925 per bushel on CBOT today, while earlier it climbed to the record of $8.4360.
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